MobileMe was a peer-to-peer synchronization service. My data lived on my machines, as well as on MobileMe.

iCloud is a server solution with local caching. The data moves to iCloud, it is no longer On My Mac.

Yes, I know it seems to be in the usual AddressBook folder, but as I discovered the real source of truth is remote. When there is a clash of opinions on the state of data, iCloud wins. If your data goes bad, you need to fix things on iCloud. Good luck with that.

Perhaps even more importantly, this is a one way trip. Yes, if you know the ins and outs you can copy Contacts back to your Mac and remove them from iCloud. You cannot, however, get your Group relationships back. That data has checked into Hotel iCloud.

With iCloud, OS X Mail and Address Book/Contacts are much more like Google Mail/Contacts -- which also has an offline mode. Apple's data lock is stronger than ever, and I have a very bad feeling about the next version of iTunes.